Freight Rates in the US and EC: The freight rates in the US and EC (European Community) remain low and have not significantly recovered since the general reductions in Q4. Rates vary, with some carriers offering less than $1,000 per 40-foot container. However, Hapag Lloyd, after a General Rate Increase (GRI) on November 15th, raised its rates above $1,500. The rates for 2024 are expected to remain similar to those in Q4 of 2023, with no significant increase or decrease anticipated.
Market Situation in WC Trade in EC: The rate levels in the WC (West Coast) trade in EC are generally higher, sometimes exceeding $3,000 to $3,500 per 40-foot container. This is attributed to limited supply of carriers and sailings, with major ports like Seattle, Oakland, and Tacoma predominantly served by MSC and Maersk. This creates a shortage of shipping options on the West Coast. On-carriage options to locations like Utah, Nevada, and Colorado via the West Coast are very limited, often only available through Houston.
Shipping Capacity and Bookings: There are currently no capacity bottlenecks or booking issues. Ships are fuller than in previous months, possibly due to the end-of-year season and some blank sailings to the East Coast. For 2024, an increase in capacity is expected as large steamship lines plan to introduce new ships.
Seasonal Factors in Germany: The “between the years” season in Germany, which runs from week 51 of 2023 to the end of week 1 of 2024, sees many factories closed and reduced operations in both industry and forwarding sectors. This results in trucker shortages, higher rates, and limited delivery/pick-up options. Additionally, a strike by German railway engine drivers in December 2023 for better pay and lesser working hours is expected to affect rail capacity and punctuality.
New Toll Rates in Germany Based on CO2 Emissions: From December 1, 2023, Germany will introduce new toll rates based on CO2 emissions following the EU’s decision. This has led to an increase in road transport costs and a reevaluation of trucking tariffs. The aim is to make rail transport more attractive and promote electric truck fleets, which are exempt from these taxes. However, there are concerns about the adequacy of electric fleets and the railway network’s reliability as alternatives to road transport, especially during a time of economic depression.
Impact of Wintertime on Transport Chains: Wintertime may adversely affect transport chains due to bad weather conditions, impacting the reliability and efficiency of transportation.
M.E. Dey & Co.
Delivering the World Since 1907
